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No action on budget; Legislature to return Friday

The Legislature is set to meet on Friday, Aug. 7 in another push to pass a budget in time to get Gov. Jan Brewer’s sales tax referral on the ballot this November.

But it remains unknown whether Republicans would be able to line up the votes in the Senate. Senate President Bob Burns said House leadership originally decided to meet on Friday and that he’s not sure what action will be taken at that time.

“I think you need to ask the House,” Burns said.

Lawmakers are looking at Aug. 10 as the deadline to refer the sales tax hike to the ballot in order for the election to take place on November 3.

“We are still trying to get the 16 votes. Time is running out on that,” the Senate President said. “If we can’t get those, then we are going to figure out what to do next.”

But it appears Republicans are not considering going to the Democrats to negotiate a deal at this point. House Republicans are actually lobbying Senate Republicans to pass a deal.

“I think the situation with going to the minority party at this point I think sets us back in time by quite a bit, because there is going to be a lot of negotiation that is going to have to take place,” Burns said.
Governor’s spokesman Paul Senseman said Democrats aren’t part of the negotiations.

“From what I understand there hasn’t been, at least, any proposals from the House Democrats that might get a hearing even, much less have a chance to succeed in the Legislature,” he said.

The House of Representatives already approved the deal last week, but it remains unknown whether Republican leaders can get the minimum votes in the Senate to pass it.

The budget package includes a provision to allow voters to weigh in on a temporary increase in the sales tax in a special election this fall. That component was absent in a budget lawmakers approved July 1, which led to the bulk of it being vetoed by Brewer, who has been pushing for the ballot referral since March.

The package also includes a $400 million a year reduction in individual and corporate income taxes starting in 2011.

But two senators are opposed to the tax hike, while a third senator is balking at the tax cuts. In addition, a handful of senators are of town, complicating matters for the GOP leadership.

Only 20 senators showed up for the special session on Aug. 4.

Rep. Debbie Lesko, a Republican from Glendale, said her vote to send the tax increase to voters reflects the reality of the situation, even though it’s against her beliefs. Brewer has demonstrated she will not accept a budget that does not include a tax increase, and it appears ther is not enough support for deeper spending cuts.

“It’s either take this deal, settle on a worse deal or run out of money and leave schools and everyone else in the lurch, and I just can’t do that,” Lesko said.

Republican leaders were able to win support for the sales tax measure by coupling it with other provisions that were palatable to fiscal conservatives, such as income tax cuts for businesses and individuals and a cap on state spending.

The sales tax increase will not be the only question posed to voters this fall if the Senate follows the House’s lead. Another component of the budget plan would ask voters to temporarily suspend a constitutional provision that prevents the Legislature from changing voter-approved programs and spending.

But it makes no sense to amend the constitution for only three years, said Rep. Andy Biggs, a Gilbert Republican.

“How absurd is that? We might as well be more like the French and adopt new constitutions willy nilly,” he said.

The budget was approved mostly along party lines in the House, with Democrats voting against all 10 bills. Minority Leader David Lujan called the proposal “a recipe for economic disaster,” in part because of tax cuts that will lead to even less revenue during a time when the state has seen its tax collections plummet.

“I am ashamed that this is the best that we could come up with after seven months,” he said.

Another provision of the budget requires all state agencies to reduce the number of full time employees by five percent.

The Senate, meanwhile, was unable to round up the 16 votes needed to approve the budget. Brewer met with Sen. Pamela Gorman, one of the Republican holdouts, for about 90 minutes in the early morning hours of July 31.

-Reporters Jeremy Duda and Jim Small contributed to this article

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